Allowed

State Bank of India v. Mr. a.Karthikeyan

DRT30 Nov 2023TA/407/2022

Case brief

AI extract

What is this about?

In a debt recovery transfer application, the Tribunal noted that the defendants failed to appear. Relying on uncontroverted documentary evidence of an outstanding loan and NPA declaration, the Tribunal allowed the application and awarded recovery with interest.

What did the court decide?

Recovery of Rs.19,13,119.71 plus interest @9% simple; sale of schedule properties and other assets; issue of Recovery Certificate; payment of costs.

State Bank of India versus Mr. a.Karthikeyan — Banking and Recovery | DRT (2023)

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IN THE DEBT RECOVERY TRIBUNAL-II, CHENNAI

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Dated this 30^th day of November, 2023

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PRESENT : SHRI T.RAJESH PRESIDING OFFICER

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TA. No.407 OF 2022

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(Old OA No.791/2019-DRT-I, Chennai)

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State Bank of India, Chidambaram Branch, Rep.by Dy. Manager, No.3, South Car Street, Chidambaram, Cuddalore District. Pin – 608 001.

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… APPLICANT

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Mr. A.Karthikeyan, S/o Arumungam, No.408, Sivan Koil Street, Kumudimoolai Village & Post, Chidambaram Taluk, Cuddalore District-608001.

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A. Nagalakshmi, W/o. Arumugam, No.408, Sivan Koil Street, Kumudimoolai Village & Post, Chidambaram Taluk, Cuddalore District-608001. … DEFENDANTS Counsel for Applicant : Mr.D.Mukundan. Defendants : Exparte.

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O R D E R

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The above Transfer Application is filed under section 19 of the Recovery of Debt and Bankruptcy Act seeking recovery of

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Rs.19,13,119.71 with further interest from the date of filing of the OA and also by allowing the same to be recovered from the defendants jointly and severally and also by sale of tractor and property.

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The above original application is filed before the DRT-I and stood transferred to this Tribunal and renumbered as above.

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The case of the applicant can be encapsulated as follows:-

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The 1^st defendant being the borrower and 2^nd defendant being the guarantor/mortgager had applied for and availed a Term loan for Rs.4,84,000/- from the applicant.

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It is also stated that the above facilities were availed after execution of necessary loan documents by defendants obliging themselves to repay the amount promptly and regularly, without fail.

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Apart from execution of the necessary loan documents, the 2^nd defendant had created security by way of equitable mortgage over the schedule properties. Apart from execution of the necessary loan documents, hypothecation tractor marked as being the security for repayment of the loan.

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Even though the defendants had obliged themselves to repay the amount promptly and regularly, they failed to do so, resulting defaults in the account and the same being declared as NPA on 31.03.2014.

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The applicant’s officials had on many occasions approached the defendants requesting them to repay the account and despite the same, no effort was made by the defendants to get the account regularized over to pay back the amount. Even as no repayment was made despite repeated request, the applicant had on 22.01.2018 caused to issue a lawyer notice requiring repayment of the amount due in the account.

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It is also the case of the applicant that despite repeated reminders and requests the defendants had failed to make the repayment forcing the applicant to file this OA seeking recovery of the amount due in the account with further interest and cost.

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Even as the defendants failed to enter appearance, they were set exparte on 11.03.2020.

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The applicant had let in evidence through AW1 who had sworn to a Proof Affidavit in terms of the pleadings in the OA and also produced Exhibits A1 to A11 and got the same marked.

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Heard the counsel for the applicant and considered the contention as taken in the OA in the light of documentary evidence and proof affidavit. The following issues arise for consideration in this matter.

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i) Whether the applicant had succeeded in proving the OA claim?

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ii) What orders are to be passed?

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Both these issues are gone into and decided together.

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The case put forth by the applicant in the Application remains unrebutted as defendants remain exparte. The evidence tendered by the applicant remains uncontroverted and undisputed. The evidence put forth by the applicant were found admissible. From the statement of accounts as produced by the applicant, it is evident that the amount as claimed in the OA is outstanding in the account, which the applicant is entitled to get recovered from the defendants and their assets (including the schedule mentioned property). The claim of the applicant is well within the period of limitation and there is no Capitalization of penal interest. Since the applicant has claimed contractual rate of interest from the date of filing the OA, taking note of fact that the applied rate of interest is on the higher side, this Tribunal is of the opinion that pendentelite and future interest can be awarded at a reduced rate of 9% (simple)

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In view of the finding as entered above

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i) TA.No.407/2022 stands allowed.

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ii) Applicant is permitted to recover an amount of Rs.19,13,119.71 with future and pendentelite interest @

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9%(simple) from the date of filing of the TA till

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realization from the defendants after giving credit to all

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the amount recovered and received during the pendency

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of the TA.

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iii) The schedule property to be proceeded against and sold and if the sale proceeds are not sufficient the defendants and their other assets are liable to be proceeded against.

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iv) A Recovery Certificate is to be drawn and issued to the recovery officer to enable recovery of the amount as per the above terms.

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v) Applicant is allowed to realize cost of the proceedings for which cost memo is to be filed in 7 days’ time from the date of receipt of the copy of the order.

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Communicate a copy of the order to the parties concerned in terms of

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Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993.

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( Dictated to PA, transcribed by him, corrected, signed and pronounced by me in the Open Court, this 30^th day of November, 2023 )

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Sd./(T.RAJESH) PRESIDING OFFICER DRT-II, CHENNAI

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State Bank of India v. Mr. a.Karthikeyan

Case brief

What is this about?

What did the court decide?

State Bank of India v. Mr. a.Karthikeyan

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

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